After many experiences with harvesting wisdom from within an organization, rather than relying on outside consultants or assuming I knew everything (or anything for that matter), conversations with various MBA school faculty led me to a parallel universe book, “The Wisdom of Crowds” by Surowiecki. This paraphrased excerpt corroborates the same point:
...[my findings challenge] the assumption that true intelligence resides only in individuals, that finding the right person—the right consultant, the right CEO—will make all the difference. In a sense, the crowd is blind to its own wisdom. Trying to find smart people will not lead you astray. Trying to find the smartest person will.
Further from Surowiecki, comments in brackets are his:
The four conditions that satisfy wise crowds are: diversity of opinion (each person should have some private information, even if its just an eccentric interpretation of the known facts), independence (people’s opinions are not determined by the opinions of those around them), decentralization (people are able to specialize and draw on local knowledge), and aggregation (some mechanism exists for turning private judgments into a collective decision).
Business organizations seem to meet all the first three factors; diversity or difference of opinions, independence, and decentralization via different departments prevailed in every one of my experiences. The key remaining factor is aggregation. The CEO’s tough job, providing the rudder, is collecting these private judgments and opinions, and turning them into smart decisions. By creating a reasonably informed employee constituency and inviting candid input, intelligent aggregation will be very rewarding. This is of course the exact opposite of an oppressive management style.
Many CEOs or boards look for the consultant who will provide the strategic beacon. I have witnessed consistent disappointment with this approach but almost universal success with gathering and cultivating the wisdom inherent in the organization’s individuals. The skill is in separating good ideas from bad, putting the good ones into patterns or packages, and then incorporating that input into an ever-improving set of priorities and strategic direction.
I used this exact process at Northern Ordnance. The initial communication campaign, after much one-on-one walk-around interaction, was holding 40 meetings with around 100 employees each, mixed among production, engineering, business development and administration. Before holding those 40 meetings at Northern Ordnance, the management team operated under a “comfort zone” mentality. Challenges, questions and new ideas were typically deflected with time-proven responses such as: “That’s the way we do it,” “I know Bill would agree,” and “We tried that last year.” Years of poor and counterproductive practices had bred procedures that avoided criticism and stress.
Getting costs and schedules under control required a rapid installation of, acceptance of, and adherence to a MRP (material resources planning) system. But virtually every shop-floor practice and existing management attitude was completely in conflict. Compounding the problem were its dimensions: 4,000 employees; systems with over 1,000,000 part numbers and over 5,000,000 parts; production cycles extending approximately three years; and forty-plus years of manual, expedited manufacturing processes.
Of the many specific tactical problems, the ridiculousness of just two should give you some idea of the task I faced.
Over the years, Admirals and US Navy program managers had become incensed when, while their own system was well behind schedule, they found work stations with idle production workers or machines. Ignoring the fact that there was absolutely no link between the two, their fury bludgeoned management into creating a backlog pile for each work station. This approach added immeasurably to costs, working capital and delays.
Despite already amazingly long production cycles, final system shipments were always further delayed because critical components showed up out-of-spec. Again; screaming customers! The fix was to produce a 10-20% overage of all critical items. This dark-ages approach added radically to costs and working capital, and in its own way lengthened production cycles.
Got the picture? The practices that had been instituted were just bad. The procedures contributed little or nothing to fixing problems and often made them worse. On top of that, workers had been bludgeoned into doing things this way until they were numb. Not only did they keep quiet about their ideas, they would rather have had a tooth pulled without anesthesia than risk the ire of a manager who didn’t want to hear the words “better,” “faster” or “smarter.”
Of course, most of the input I received in those sessions wasn’t worthwhile. And yes, 40 meetings meant we heard a lot of the same things over and over. When comments were off base or just whining…well, that’s where the CEO rudder kicked in. We loaded up all the good ideas, dumped the lesser ones overboard, clarified points of new direction in mid-meeting as they emerged, and plotted out a new course. As you may have read earlier, this was one of the ingredients of one of the most colossal turnarounds in U.S. history.
Creating an atmosphere in which all employees can contribute to a better, faster, smarter organization makes sense. Your processes work better, your finances improve, and the company creates a dedicated workforce that feels valued. Open up the captain’s cabin, step out onto the deck, and fill your sails with the organizational wisdom that will propel your company into the future. I know it works. Surowiecki concluded the same from an entirely different perspective. Using this approach helps make you a leader; one that organizations will follow with dedication.
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